EURUSD Retraces to Fibonacci and SMA Confluence of Resistance

  • Technically the EURUSD is up against resistance on the daily and the coronavirus spread in Italy is likely to add fundamental pressures as safe havens sought.

EURUSD Hits Daily Confluence of Resistance

Further to our previous article, the left chart shows the EURUSD daily time frame. The currency pair has retraced to the 38.2% Fibonacci level, which may come into play as resistance. Moreover, price is also being hampered by the black 20-day SMA which is still pointing down, with the daily RSI below 50 (blue rectangle), which is indicative of a bearish momentum. The right chart shows the short-term hourly time frame. Here the green 5-hour EMA has crossed below the orange 10-hour EMA, and the stochastic has turned bearish (blue ellipses). Thus, short-sellers may be eyeing current levels.

Today has seen the number of coronavirus cases in Italy climb to 374 from 322 yesterday and Greece has confirmed it first case. Moreover, a number of the cases are in Milan and surrounding areas, which has one of the highest levels of public transport in Europe. This will likely give support to the dollar (and gold) as safe haven assets are sought.